Apple Used to Be an Inventor. Now It’s Mainly a Landlord.
It’s cashing in on loyalty, but Apple can’t keep raising iPhone prices forever. So far, its services aren’t insanely great.
Apple’s new tune.
Photographer: Justin Sullivan/Getty Images North AmericaFor years, analysts and journalists watching Apple Inc. have talked up the growing importance of services, as opposed to hardware sales, to the company’s top line. But it’s only now that Apple’s business model truly appears to be shifting toward collecting rent from the company’s ecosystem and increasingly relying on gadget sales to perpetuate this rent rather than drive growth. Apple’s decision to stop reporting iPhone unit sales underscores the shift.
Services have been steadily growing in importance for Apple since 2016, while the share of revenue provided by the flagship gadget, the iPhone, has gone up and down depending on the popularity of different models.